BlackBerry posts reports a surprise profit

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The BlackBerry Z10 was among a line of phones the firm unveiled Jan. 30.

By Ian Austen
New York Times
March 29, 2013

OTTAWA — BlackBerry reported a surprise profit on Thursday for its latest quarter, when it introduced a new line of phones and new software to revive its once-dominant cellphone brand. But it still recorded a loss of $646 million for the entire fiscal year.

The annual loss, which tax benefits reduced from an operating loss of $1.2 billion, compared with $1.16 billion in net earnings a year earlier.

In the latest quarter, which ended March 2, the company lost $18 million from operations. But recovery of income taxes transformed that into a $98 million profit for the quarter, or 19 cents a share.

BlackBerry has struggled with declining sales. Revenue in the latest quarter was $2.6 billion, compared with $2.7 billion in the same period a year ago. Annual revenue fell to $11 billion, from $18.4 billion a year earlier.

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For about one month of the quarter, the first of its new phones, the BlackBerry Z10, was on sale in Canada, Britain, and some other markets, but not the United States. BlackBerry said that it shipped about a million of the handsets during that time.

It nevertheless reported that there were 79 million BlackBerry subscribers worldwide at the end of the period, a loss of about 3 million users. Until the third quarter of the fiscal year, BlackBerry had consistently increased the number of subscribers.

In an unanticipated move, the company announced that Mike Lazaridis, one of its founders, would cut all formal ties to BlackBerry in May. Along with Jim Balsillie, Lazaridis stepped down as chairman and chief executive in January 2012. Although Balsillie left shortly afterward, Lazaridis remained on BlackBerry’s board as vice chairman.

AT&T became the first US carrier to offer the new phone last week. But visits to several wireless stores Wednesday found striking differences in sales support for the phone that BlackBerry hopes will revive its much diminished fortunes.

At several locations, including an AT&T store on Fifth Avenue in New York and another near Union Square in San Francisco, the Z10 was lumped in with other phones, some two years old, while signs and promotional material were absent.

But at an AT&T store in New York’s busy Union Square, the Z10 was heavily promoted. A salesperson there who identified himself as a BlackBerry specialist gave a deep demonstration of the device, including its ability to switch between corporate and personal apps.

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